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Thursday, August 29, 2013

Hiding health facts may result into repudiation of claims

The Goa State Consumer Disputes Redressal Commission has reversed the
order of the North Goa District Consumer Disputes Redressal Forum which ordered
the SBI Life Insurance Company to honour the Insurance claim of a deceased
person who hailed from Marcel in Ponda taluka.

The SBI Life had repudiated the claim on the basis that the deceased
had withheld the facts that he was suffering from diabetes and was chronic
alcoholic. The Goa State Consumer Disputed Redressal Commission has brushed
aside the complaint against the bank.

The deceased had taken a house loan of Rs 10 lac from the St. Estevam
branch of the State Bank of India in January 31, 2008. The deceased had also
taken a group insurance policy from the bank meant for housing loan borrowers
of SBI. Though the deceased had submitted a good-health declaration to avail of
the policy, the policy stipulated that the assurance would be null and void, if
any incorrect averments were made or if any information was suppressed.

In October 2008, the deceased
was admitted to a hospital where he diagnosed with cirrhosis of liver and his
past history was recorded as a 'known case of diabetes mellitus on regular
treatment'. He was then admitted to other hospital for further treatment. Here
it was noted that the deceased had a history of diabetes, was a smoker and
chronic alcoholic for 20 years. He expired on November 7, 2008. The hospital's
death summary listed a long list of medical conditions including 'alcoholic
liver disease'.

The nominee, wife of the deceased filed an insurance claim but the
insurer rejected the claim stating that the deceased had given a false good
health declaration at the time of entering into the insurance scheme. The wife
approached the district forum which ruled in her favour. The bank then appealed
before the Goa State Consumer Disputes Redressal Commission. The commission
observed that the deceased has suppressed the facts and gave false answers to
obtain the policy. The commission termed it a fraud case because the insured
despite being a regular smoker, a drinker for 20 years, a diabetic for three
years on medication who eventually died of cirrhosis of the liver, had withheld
the facts at the time of signing the policy.